The Florida state Medicaid agency made an estimated $26 million in overpayments to managed care organizations (MCOs) for deceased Medicaid beneficiaries, according to the HHS Office of Inspector General (OIG). The Florida Agency for Health Care Administration made the payments during the July 1, 2009, through November 5, 2014, audit period due to a failure to timely update dates of death (DODs) in its information management system and a failure to collaborate with other agencies or use additional sources to identify inconsistencies in DODs. The state agency claims to have already recovered $24 million in overpayments and is making efforts to improve collaboration. The OIG emphasized the need for the state agency to remove all beneficiaries with DODs listed in its information management system from managed care plans and improve its system to remove variances from data sources (OIG Report, A-04-15-06182, November 30, 2016).

Since 2011, the state agency has managed the Florida Statewide Medicaid Managed Care Program (SMMC), which is an expansion of a pilot created through a section 1115 waiver in 2006. As of 2014, nearly all Medicaid beneficiaries in the state were enrolled in the SMMC. In return for the provision of specified services, the state pays MCOs monthly capitation payments for each enrolled beneficiary, regardless of whether the beneficiary receives services during the covered time period. The state agency maintains the capitation payment database through the Florida Medicaid Management Information System (FMMIS). It uses the FMMIS to ensure that payments are properly adjusted. DODs obtained through three different databases–the State Data Exchange (SDX), the state Department of Health, Bureau of Vital Statistics (BVS), and the Florida Online Recipient Integrated Data Access System (FLORIDA)–are updated in the FMMIS.

Overpayments

The OIG reviewed 124 capitation payments made during a more than five-year time period that were preceded by DODs and focused on 113 overpayments that were recoverable but had not yet been recovered. In 62 of these instances, the state agency did not timely update DODs in the FMMIS and beneficiaries’ enrollments were not updated. In 42 instances, DOD information derived from the three sources was incorrect or inconsistent. Where data were inconsistent, the state agency removed the DODs from the FMMIS to ensure that beneficiaries would continue to receive services until the DODs were determined. However, the state agency failed to collaborate with the DOD sources or the Department of Children and Families (DCF) to identify the source of the inconsistencies, and failed to use alternative sources, such as Accurint, the Massachusetts Registry of Vital Records and Statistics, or the Indiana State Department of Health, Vital Records. In nine instances, DOD information was missing and the FMMIS did not identify the beneficiaries as deceased.

Recommendations

The OIG recommended that the state agency identify and recover more than $26 million in overpayments to MCOs and return the roughly $15 million federal share; perform monthly FMMIS reviews to ensure that deceased individuals are removed from the SMMC; implement policies and procedures for quickly identifying and correcting inaccurate death information; and improve collaboration with the Social Security Administration (SSA), DCF, and BVS to identify and resolve inconsistencies. The state agency indicated that it had recovered roughly $24 million in overpayments and identified slightly more than $200,000 in payments as correct. It also outlined steps it is taking to improve collaboration among agencies. However, it claimed that it could not identify instances in which individuals with DODs were not removed from plans, an argument the OIG combatted with the 62 instances described in its report. The state agency also indicated that its Medicaid Fiscal Agent Operations (MFAO) bureau already implements an automated system hierarchy to resolve variances, but the OIG determined, based on its findings, that the system is inadequate.